Blunt talk from Bernie Marcus about Obama and economy

This has been a week for CEOs speaking out against the Obama administration. This time it’s someone I actually admire. Bernie Marcus, co-founder and CEO of Home Depot, has given an interview to Investors Business Daily and it is a pretty frank denunciation of the policies this administration has followed since coming into power. It’s one of the things I admire about Marcus – he pulls no punches:

IBD: What’s the single biggest impediment to job growth today?

Marcus: The U.S. government. Having built a small business into a big one, I can tell you that today the impediments that the government imposes are impossible to deal with. Home Depot would never have succeeded if we’d tried to start it today. Every day you see rules and regulations from a group of Washington bureaucrats who know nothing about running a business. And I mean every day. It’s become stifling.

If you’re a small businessman, the only way to deal with it is to work harder, put in more hours, and let people go. When you consider that something like 70% of the American people work for small businesses, you are talking about a big economic impact.

Remember that Home Depot was launched during the then worst recession in 40 years and Marcus took it public 3 years later. He’s built a business from the ground up and created thousands of jobs. He actually understands what it takes. He also clearly understands what will kill it.

Here is one of the key points one has to understand about this administration and Marcus is on it:

IBD: President Obama has promised to streamline and eliminate regulations. What’s your take?

Marcus: His speeches are wonderful. His output is absolutely, incredibly bad. As he speaks about cutting out regulations, they are now producing thousands of pages of new ones. With just ObamaCare by itself, you have a 2,000 page bill that’s probably going end up being 150,000 pages of regulations.

We’ve been warning you from the beginning to pay no attention to the man’s words and instead scrutinize his deeds. Often they are the opposite of what he has said he’d do. For example:

In January, however, he issued an executive order requiring federal agencies to review their regulations, looking for rules that are inefficient or outdated. His aim, he explained on The Wall Street Journal‘s op-ed page, was to "root out regulations that conflict, that are not worth the cost, or that are just plain dumb."

But there’s a catch: All those new regulations Obama put in place will not be subject to review. Just days after the president issued his order, an anonymous administration official conceded to the Journal that "new regulations will not be priorities for the look back." Meanwhile, more than a dozen federal bureaucracies—including the Securities and Exchange Commission, the Federal Communications Commission, and the National Labor Relations Board—are exempt from the review because they are independent agencies.

That’s another in a long list of many examples of him saying one thing and doing something else. His speeches are politically driven and designed to give him political cover while his actions are ideologically driven and part of an agenda.

Marcus is then asked about the debt talks:

IBD: Washington has been consumed with debt talks. Is this the right focus now?

Marcus: They are all tied together. If we don’t lower spending and if we don’t deal with paying down the debt, we are going to have to raise taxes. Even brain-dead economists understand that when you raise taxes, you cost jobs.

With all the talk about tax increases it means we have a lot of zombie politicians who haven’t a clue, unfortunately. I mean how difficult is this? When you raise taxes in a recession, many businesses are going to have to make a decision aren’t they? Use the money to pay the tax or hire. Any guess which will win out? You can’t go to jail for not hiring.

Finally, and this one is devastating in its forthrightness, Marcus is asked what he’d tell Obama if he could sit down with him and talk about job creation. His answer is a classic:

IBD: If you could sit down with Obama and talk to him about job creation, what would you say?

Marcus: I’m not sure Obama would understand anything that I’d say, because he’s never really worked a day outside the political or legal area. He doesn’t know how to make a payroll, he doesn’t understand the problems businesses face. I would try to explain that the plight of the businessman is very reactive to Washington. As Washington piles on regulations and mandates, the impact is tremendous. I don’t think he’s a bad guy. I just think he has no knowledge of this.

One can only wish Contessa Brewer was around to ask about economic degrees. Marcus is right about Obama’s lack of knowledge. He’s surrounded by a lack of knowledge in this area if his policies are any indication. As has been pointed out repeatedly, a president who was really concerned about jobs would be green lighting oil and gas exploration as fast as he could make it happen. And he’s certainly made speeches about doing just that, but as usual, his actions betray his words.

Marcus has got a bead on this administration and this president. As long as they are in power and continue with the course of their regulatory policies, the economic malaise that has settled over this country will continue.

8 Responses to Blunt talk from Bernie Marcus about Obama and economy

I’m not sure Obama would understand anything that I’d say, because he’s never really worked a day outside the political or legal area.

I suggest that the problem is not Captain Bullsh*t’s lack of business experience; judging by their campaign contributions, there are plenty of rich and successful liberals in business who think his policy prescriptions are just peachy. Rather, it’s his ideology: the moron actually seems to think that raising taxes and adding regulatory requirements are GOOD for business:

So my general view is that if the American people looked at this, they’d say, boy, some of these decisions are tough, but they don’t require us to gut Medicare or Social Security. They don’t require us to stop helping young people go to college. They don’t require us to stop helping families who’ve got a disabled child. They don’t require us to violate our obligations to our veterans. And they don’t require “job-killing tax cuts.”

“there are plenty of rich and successful liberals in business who think his policy prescriptions are just peachy.”
1) Subtract all lawyers from this amount. More laws and more regs means more work for them.
2) Subtract those who depend on Federal Subsidy or Bail Outs. GE, GM, Wall Street, etc.
3) Subtract the tech companies who really don’t have to worry about large payrolls and have enough resources to handle the ones they do easily. When outsource all of your production to China and just keep a handful of geniuses on staff in Palo Alto, regulations don’t mean much. You’ve outsourced the most onerous. Oh, I suppose the handicap access ramp to your campus is a bit of trouble.

Watch what we do, not what we say,” was the famous advice Nixon’s first Attorney General, John Mitchell, gave the press at the onset of the Nixon presidency in 1969. It’s a handy piece of advice in the Age of Obama too, as we roll towards the end of his first six months in office. There’s the added difficulty that Obama likes to say two different things in the same speech, usually prefaced by his trade-mark “Let me be clear.”
“And let me be clear,” he told the Russians in Moscow, even as he presses forward with the Clinton/Bush policy of NATO expansion, ringing Russia with missile bases, “NATO seeks collaboration with Russia, not confrontation.
Courtesy of Alexander Cockburn in 2009.
Bernie has it right.

On July 14, 2008 the regular gas average price was $4.11 per gallon, the highest in history, and that day President Bush rescinded the Executive Order against drilling; within 4 days oil prices had dropped by 12%. Eventually it dropped to $1.60 just before Mr. Obama was sworn into office. President Obama has reinstated that EO for the next 7 years and we can see the reverse has happened, although his latest message is hopeful about him changing his position; but I’ll believe it when I see concrete actions. And apparently the market didn’t believe him either because prices didn’t drop much nor did they stay there.